Readers' Corner: Debt Counselling

Sanjay Agarwal, executive vice-president - SME & retail business, Arcil, answers your questions

I got a call from my bank that I am eligible for a free credit card, without any annual fees. If I take the card now and the bank starts charging a fee later on, can I return the card?

Annual fee is charged and is payable yearly in advance. This means you pay the fee immediately after issuance of the card and every year thereafter. If the issuing bank is not charging this fee for the first year and you don't want to pay any annual fee subsequently, you can surrender the card and have it cancelled after using it for one year.

I'm planning to apply for a home loan. What are the reasons my application could get rejected and what are the chances of getting a loan from another bank?

Credit underwriting parameters vary for different lenders. If your application is declined by one bank, you can always approach others. But, the loan amount, tenure and sanction conditions could be different. The factors that determine your loan eligibility can be classified in two categories. One is related to the loan and your credit worthiness, where the loan amount, loan-to-value ratio, your income, its source and consistency, credit bureau score, existing liabilities, repayment tenure, etc are important. The second is related to the property, such as its location, approval of the project by the bank, reputation of the builder, stage of completion, legal status of the title of the property, etc.

The views expressed are expert's own. Send your queries to yourmoney@bsmail.in